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Oregon Legislature

Transportation, carbon package deal collapses

Bipartisan negotiations fail to produce an agreement on funding and emission reductions

By Saul Hubbard

The Register-Guard

Appeared in print: Friday, June 26, 2015, page B3

SALEM — Gov. Kate Brown and Senate President Peter Courtney decisively pulled the plug on a mammoth, last-minute package of transportation funding and carbon emission reduction policies on Thursday, less than 48 hours after its full details were publicly unveiled.

Acknowledging the failure of the bipartisan negotiations that she revived, Brown said in a prepared statement Thursday morning that “given the complexity of the issues and the remaining time available, there simply isn’t a path forward through both chambers for a proposal” that both boosts transportation funding and reduces carbon emissions.

Addressing the full Senate shortly afterward, Courtney praised the “weeks, days and hours” of work by the small group of Republican and Democratic lawmakers who crafted the package.

“I’m so sorry that we couldn’t break through,” he said.

The decision by Democratic leaders followed a disastrous public hearing on the proposal on Wednesday. That presentation cast doubt on one of supporters’ key selling points: that the package’s carbon emission elements were comparable or better than the program it would have replaced, known as “clean fuels.”

As lawmakers quickly turned their minds to the session’s adjournment, the chances that a revived or new package could surface again in a special legislative session later this year appeared remote.

In her statement, Brown said transportation funding and carbon emission policy “should be decoupled and considered separately, thus avoiding the ‘my way, or no highway’ situation in which we now find ourselves.”

But Senate Minority Leader Ted Ferrioli, a John Day Republican, said Republicans will remain united in refusing to consider backing gas tax and fee increases for transportation projects, until the new “hidden” gas costs caused by the “clean fuels” program are eliminated.

Brown “doesn’t want to link the two anymore. I do,” he said.

A handful of leading lawmakers also are expected to start campaigning for other offices after the session wraps up, most likely making them less enthusiastic about returning to Salem to take a tough vote for new taxes, observers said.

The exceptionally rapid disintegration of the package led to plenty of post-mortem finger-pointing.

Sen. Lee Beyer, a Springfield Democrat, said he was personally “agnostic” about repealing “clean fuels,” if the replacement policy led to the same reduction in car and truck carbon emissions. But environmental groups “needed that skin on the wall for their constituency,” he said.

“It’s understandable,” Beyer said. “ ‘Clean fuels’ was their policy, that was what they were pushing, that was what they raised (campaign) money on.”

Environmentalists blamed the oil industry for killing the transportation funding package by trying to tie it to an industry-friendly rewrite of “clean fuels.” Under the “clean fuels” program, traditional fuel producers will have to blend cleaner biofuels into their products and most likely pay to subsidize alternative energy producers as well.

“This whole debacle lived and died on the oil industry’s meddling,” said Doug Moore of the Oregon League of Conservation Voters.

Lawmakers in the Senate were quick to cast blame on the House, whose negotiators weren’t involved in crafting the final version of the package, for intransigence.

The proposal appeared dead on arrival in the House, where 19 Democrats last week signed a letter saying they wouldn’t back any deal that involved a full repeal of the “clean fuels” law.

Ferrioli said House negotiators ultimately stopped working on the deal because House Democratic leaders, and in particular Speaker Tina Kotek of Portland, “were not interested at all.”

“It’s the Democrats and the environmentalists I think that are stuck in the old rhetoric of bashing corporations and ‘Big Oil,’ ” he said. “Republicans were leading the conversation on a realistic emissions reduction plan.

“Charging people more to fill up may be a strategy some favor to get them out of their cars,” he added. “But two-thirds of the state doesn’t have access to any alternative forms of transportation.”

Asked about that criticism, Kotek’s office deferred to House Majority Leader Val Hoyle, a Eugene Democrat.

In a prepared statement, Hoyle said Wednesday’s hearing showed that the package “was fatally flawed, filled with too many unanswered questions and based on too many incorrect assumptions.”

“People worked hard on this, but in a rush to get things done in the last few weeks of the session, it was impossible to put together something as complex as a transportation package,” she said.

The “clean fuels” policy still faces a legal challenge from the oil industry, which also is preparing to take the issue to the 2016 ballot. On Thursday, proponents submitted collected signatures in order to get three ballot titles drafted for measures that would repeal or replace the program.

Paul Romain, a lobbyist for the Oregon Fuels Association, said he always expected that changing “clean fuels” would be difficult after lawmakers approved it in March.

“The governor showed a heck of a lot of leadership, but House Democrats just had their backs up,” he said. “We will see what the public thinks about this in 2016.”